In a year when the average rate on a 30-year fixed mortgage fell to new record lows — it’s been under 4% for more than two months straight now — home prices also dropped, about 3% to 4% over the past 12 months, depending on the index.

It’s not supposed to be that way. You’d think lower rates would help jump-start purchases and that demand, in turn, should push prices higher.

But there’s the rash of foreclosures pushing home values down. And then there’s the problem, these days, of getting financing — lenders’ underwriting standards are much stricter.

And then there’s buyer confidence: If your job’s on shaky ground, why would you want to shell out big bucks to buy a house? While the jobless rate has dropped — it was at 8.6% in November, down from 9.8% in Nov. 2010 and about 10% the year before that — and enough new jobs are being created now to absorb the natural increase in the labor pool, there aren’t enough new jobs yet to absorb the large numbers of long-term unemployed people. Read more: U.S. jobless claims indicate modest improvement in job market.

As MarketWatch’s Steve Goldstein notes in that story, in Atlanta, where the unemployment rate is 9.9%, home values are tumbling. In Washington, where unemployment is just 5.7%, home prices are on the rise.

Here’s hoping that 2012 brings a hiring binge nationwide — and all the best to you and yours in the New Year.

Charting how home prices are moved by rates, city

All things equal, lower mortgage rates should spur increased demand for houses, whether that shows up in prices or in transactions. That formula held through the beginning part of the last decade — mortgage rates fell, and house prices boomed. Read more: Charting how home prices are moved by rates, city.

12 mortgage moves to buy a home in 2012

12 reliable real estate tips for 2012

To buy or sell in 2012, what with Armageddon coming and all? Absent any ancient Mayan wisdom on real estate strategies, let’s just hope the real cataclysmic event in the real estate market already has passed, even if the rubble from the bubble remains. Read more: 12 reliable real estate tips for 2012.

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